What they are going after is the crown jewel in the legislation; the Consumer Financial Protection Bureau, that has sweeping and unchecked powers.
A Texas community bank and two advocacy groups are filing suit in U.S. District Court to challenge the constitutionality of the Dodd-Frank financial reform law.
In particular, the suit will contend that the Consumer Financial Protection Bureau (CFPB), created by the law, lacks sufficient checks and balances and, in the words of the CEO of State National Bank, is "simply unconstitutional."
"No other federal agency or commission operates in such a way that one person can essentially determine who gets a home loan, who can get a credit card and who can get a loan for college," said bank head Jim Purcell. "Dodd-Frank effectively gives unlimited regulatory power to this so-called Consumer Financial Protection Board, also known as CFPB, with a director who is not accountable to Congress, the President or the Courts."
Two conservative groups, the Competitive Enterprise Institute and the 60 Plus Association, have also signed on to the suit, which will be filed against the nation's financial regulators.
C. Boyden Gray, who served as White House Counsel under President George H.W. Bush, will represent the plaintiffs in court.
Gray told reporters that the lawsuit was not a challenge to Dodd-Frank as a whole, but rather two specific sections that create the CFPB and a new regulatory group, the Financial Stability Oversight Council (FSOC). The FSOC gathers the nation's top regulators to oversee the financial system as a whole, and charges it with identifying what financial institutions pose unique risks to that system and merit heightened oversight.
It's an uphill climb to get the court to see it this way. But the effort must be made.